(Antigua Newsroom)Despite becoming one of the first Caribbean destinations to reopen to tourism on June 1, Prime Minister Gaston Browne says the Government of Antigua & Barbuda will have no choice but to increase the country’s debt burden.

He says this is due directly to the effect that the coronavirus lockdown has had on the country’s economy.

“The truth is we have to be engaged in some level of borrowing even though very sparingly,” Browne told listeners to his radio programme.

“I can see us borrowing about 150 million dollars to help to stimulate the economy and not to give people cash grants but to provide for certain sectors, to stimulate certain sectors especially agriculture and light manufacturing and even to generate construction work so that people can be put to work,” he said.

The prime minister disclosed that as the months go by “it is becoming increasingly difficult for us to pay public servants.”

He said this is why a direct cash stimulus would be a poor decision for the government to make. He said the government would have to borrow millions to make this possible

“When you borrow you increasing the debt to GDP and you not creating any significant value there and by the way if anything you will be reducing economic output,” Browne who is also finance minister said.

He said even with the $150 million loan the amount government pays monthly to service loans will increase.

“There is going to be an automatic increase in the debt to GDP. It may not shoot up…because we moved quickly to reopen but I’m quite sure that our debt to GDP will be about 80 something percent and even the debt service ratio will increase,” he said.

The prime minister has also defended the government’s decision to reopen the economy.

“In the case of Antigua and Barbuda, if we were to keep our borders closed until September then we would see a reduction in GDP [Gross Domestic Product] of 30 per cent in a single year,” Browne said.

“I want Antiguans and Barbudans to understand the consequences of such a decision and that is why we did not opt for such an option, that is why we opted to open first thing in June in order to reduce the financial and economic consequences of remaining closed for several months.”

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